Today, the Federal Trade Commission (FTC) formally published the revised
thresholds for premerger filings under the Hart-Scott-Rodino Antitrust
Improvements Act of 1976 (HSR Act). The FTC is required to annually adjust the
HSR Act’s jurisdictional and exemption thresholds in accordance with changes in
the Gross National Product (GNP). For the first time, these thresholds have
declined as a result of the recent GNP decline. These new thresholds, which go
into effect 30 days after publication of the Federal Register notice, are:
- The “size of transaction” test has decreased to
$63.4 million. Therefore, in order to qualify as a potentially reportable
transaction under the HSR Act, a buyer must, as a result of the transaction,
hold voting securities or assets valued in excess of $63.4 million.
- The “size of person” tests have decreased to $12.7 million and $126.9
million respectively. That is, unless either the acquired or acquiring
person has annual net sales or total assets of at least $12.7 million and
the other person has annual net sales or total assets of $126.9 million, the
transaction will often not be reportable.
- Transactions in excess of $253.7 million are now reportable even if the
“size of person” test is not met.
HSR filing fees remain unchanged, but the thresholds used to calculate the
fees have increased. Under the revised thresholds:
- Acquisitions with a value of $63.4 million up to $126.9 million require
the acquiring person to pay a filing fee of $45,000.
- Acquisitions with a value of $126.9 million up to $634.4 million require
the acquiring person to pay a filing fee of $125,000.
- Acquisitions with a value of $634.4 million or more require the
acquiring person to pay a filing fee of $280,000.
McGuireWoods’ Antitrust Department has substantial experience in mergers and
acquisitions, and it can assist you in determining how these new rules will
affect the reportability of any potential transaction under the HSR Act.